New jointly-owned business will serve growing Russian food and beverage industry.
Archer Daniels Midland Company (NYSE: ADM) and Russia-based ASTON Foods and Food Ingredients have successfully received all required regulatory approvals and launched their 50-50 joint venture to provide sweeteners and starches to customers in Russia.
ASTON is one of Russia’s largest agricultural and food ingredients businesses, with activities in farming, oilseeds crushing, edible oils and grain origination, in addition to its sweeteners and starches business unit. ADM has had operations in Russia since 1980. With the launch of the new joint venture, ADM and Aston will partner to own and operate ASTON subsidiary AKP, which includes a corn wet mill in Ibred, as well as a sales office in Moscow. Situated approximately 180 miles south east of Moscow, the Ibred plant is strategically located to serve major customers in the Russian food and beverage industry.
“Our Joint Venture has now got an excellent opportunity to realize the synergies of cooperation between two companies having wide competences in production of the starches and sweeteners, as well as marketing and logistics. We expect to have a substantial effect from developing the product portfolio and implementation of the energy saving technologies”, said Vadim Vikoulov, CEO of ASTON, upon closing.
“This investment is the latest in a series aimed at expanding ADM’s geographic footprint in regions of expected growth worldwide. We’re pleased to continue diversification with the expansion of our sweeteners and starches capabilities into Russia,” said Pierre Duprat, president, Europe, Middle East and Africa. “This is an exciting opportunity to bring together our experience and strengths to grow the jointly-owned corn business. With AKP, we are in an excellent position to serve our customers’ needs in Russia and meet anticipated growth in demand, both in the local market and globally.”
Effective from June 29, 2018, the joint venture will operate under the name AKP and will be managed as a standalone entity. Its board will be made up of equal representation from the two parent companies. ADM and ASTON’s other businesses in Russia will remain separate.
For more than 20 years, Aston has been one of Russia’s largest agricultural and food ingredient businesses. ASTON is the largest exporter of vegetable oils, the leading processor of oilseeds, the third largest exporter of Russian grain. It has a well-developed network of sunflower and corn origination and processing facilities in the western part of Russia, and is a key player in Russia’s significant edible oils and starch markets. The company includes enterprises for the production and processing of vegetable oil in Millerovo and Morozovsk (Rostov region), plants for the production of starches and syrups in the Ryazan and Vladimir regions, silo complexes in Rostov and Krasnodar regions, port terminals on the Don river and the deep sea transshipment facilities, shipyard, a fleet of dry cargo coasters and vegetable oil tankers as well as ocean bulk carriers for transportation of grain crops. ASTON supplies products across Russia as well as to Commonwealth of Independent States nations, Africa, Asia and the Far East.
For more than a century, the people of Archer Daniels Midland Company (NYSE: ADM) have transformed crops into products that serve the vital needs of a growing world. Today, we’re one of the world’s largest agricultural processors and food ingredient providers, with approximately 31,000 employees serving customers in more than 170 countries. With a global value chain that includes approximately 500 crop procurement locations, 270 ingredient manufacturing facilities, 44 innovation centers and the world’s premier crop transportation network, we connect the harvest to the home, making products for food, animal feed, industrial and energy uses.